Innovation and Commercialization: A Comprehensive Guide for 3V Organic Foods

This report delves into the crucial aspects of innovation and commercialization, focusing on the case study of 3V Organic Foods, a company specializing in organic food and drink products. It explores the importance of innovation in comparison to invention, analyzes how organizational vision, leadership, culture, and teamwork shape innovation and commercialization, and examines the 4Ps of innovation and the innovation funnel. The report also discusses frugal innovation, the commercial funnel, and the New Product Development (NPD) process for commercializing innovation. Finally, it evaluates tools for developing, retaining, and protecting knowledge and intellectual property, providing a comprehensive framework for 3V Organic Foods to enhance its business operations and achieve sustainable growth.

Innovation and
Commercialization

TABLE OF CONTENTS
Introduction......................................................................................................................................1
LO1..................................................................................................................................................2
P1 Explain innovation and determine its importance to organisations in comparison with
invention......................................................................................................................................2
P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation.................................................................................................................5
LO2..................................................................................................................................................7
P3 Explain the 4Ps of innovation and explain the use of the innovation funnel to examine and
shape innovative ideas.................................................................................................................7
P4 Explain developments in frugal innovation and provide examples of how it is used in an
organisational context................................................................................................................10
LO3................................................................................................................................................11
P5 Explain the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation of innovation.....................................11
P6 Build an Innovation Business Case for an organization, including ways to access funding.
...................................................................................................................................................14
LO4................................................................................................................................................16
P7 Evaluate the different tools that organisations can use to develop, retain and protect
knowledge and intellectual property..........................................................................................16
Conclusion.....................................................................................................................................18
References......................................................................................................................................19

LIST OF FIGURES
Figure 1: Innovation........................................................................................................................2
Figure 2: Difference between invention and innovation.................................................................4
Figure 3: 4Ps of innovation..............................................................................................................7
Figure 4: Phases of innovation funnel.............................................................................................9
Figure 5: Sales Funnel...................................................................................................................11
Figure 6: Intellectual Property Tools.............................................................................................16

LIST OF TABLES
Table 1: Innovation Funnel Stages..................................................................................................9
Table 2: New Product Development Process................................................................................12

Introduction
Innovation and commercialisation can be defined as the approach of transforming knowledge
and ideas into practicality. The report will focus on explaining the importance of innovation by
comparing it with methods of innovation. There are various factors such as leadership, vision,
teamwork, culture, etc that shape the process of innovation which are analysed in the report. The
report will highlight the types of innovation with an emphasis on 4Ps of innovation with the help
of innovation funnel as well as frugal innovation.
The report will also discuss the process required to commercialise innovation with the
application of new product development as well as building of innovation business case to access
the ways of funding. Last task of the report will focus on evaluating tools to develop and retain
the knowledge and intellectual property in context to 3V Organic Goods which specialises in
providing natural and organic food and flavoured drink products. The report will focus on
innovating new organic and natural drinks by considering the health of customers
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LO1
P1 Explain innovation and determine its importance to organisations in comparison with
invention
Overview of innovation
Innovation can be defined as new ideas or processes to the existing ones for the growth of small
and medium business enterprises. It is also referred to as application of enhanced solutions so as
to fulfil the new requirements as well as existing needs of market (Innovation Management,
2018). It has been identified that innovation is one of the important factors for increasing the
wealth of business organizations. However, efficiency is important for business growth but
innovation at the same time support business sustain the growth for long term.
Figure 1: Innovation
(Source: Andrew Woodward, 2013)
Innovation in SME ‘3V Natural Foods’
Innovation in ‘Small and Medium Business Enterprises’ not only support it to gain growth and
development in business but also support them to sustain for longer term in the competitive
market (De Massis et.al.2016). 3V Natural Foods specialises in providing organic food and drink
products. An organization has developed at a rapid speed in terms of business growth but its
sales dropped down in past few years and therefore as per the case study it is important to embed
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innovation to escalate its sales. An organization will launch new drinks with new flavours to
extend its market segment which will reflect some impacts on its growth.
Importance of innovation in ‘3V Natural Foods’
New flavoured drinks that are highly natural will help ‘3V Natural Foods’ to form new customer
base as well as support it to establish new relationship with other medium and large
organizations to gain new opportunities in the market. Along with innovation in its drink
products, it must focus also focus on implementing new technology to enhance their accounting
and marketing processes (Mazzei et.al.2016).
Drinks with natural flavours will attract large number of customers which can be further utilised
as the marketing strategy as many of the satisfied customers will recommend their known ones to
try the innovative products. Many of the large organization dealing with beverages
manufacturing and distribution may be benefited with the new and innovate products developed
by ‘3V Natural Foods’. Therefore it can be concluded that innovation in business will help it to
form subtle relationship with emerging business to accomplish goals in terms of profitability.
Innovation VS invention
By assuming the case study of ‘3V Natural Foods’, innovation can be defined as introduction of
new natural flavours to the existing drinks and beverages. Innovation is bringing changes to
current products offered by business. This is the process that is introduced because of market
forces which in turn will help to achieve products as well as to improve the customer experience.
Innovation in marketing of new natural drinks will help to attract more customers. It is important
for an organization to make people aware about new products by using advanced marketing
technologies.
Invention on the other hand is defined as introduction of new products or services to compete
with competitors irrespective of bringing changes in existing products. Invention in ‘3V Natural
Foods’ will bring new beverages and food products that shows further creativity with respect to
innovation (De Massis et.al.2016).
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Figure 2: Difference between invention and innovation
(Source: Process of Invention & Innovation, 2018)
4

P2 Explain how organisational vision, leadership, culture and teamwork can shape innovation
and commercialisation
Innovation and relevant ideas are necessary to relate vision, leadership with process involved in
innovation. There exists wide range of internal as well as external factors that are necessary to be
considered in order to undertake decision making process. Innovation as discussed earlier
support business entity to gain financial growth which is further referred to as commercialisation.
With reference to current case study of ‘3V Natural Food’, it is important to consider the
elements such as vision, leadership, teamwork as well as culture to shape the commercialisation,
and innovation (Annunziata, 2015).
Vision: Vision plays an important role in achieving long term goals within a business entity.
Appropriate strategies are developed and communicated amongst the employees of ‘3V Natural
Food’ to accomplish a defined objective which is referred to as its vision. 3V Natural Foods is
based on providing organic food and drink products to the retailers as per their demand. Due to
lack in fresh essence in its drink products, it is essential for an organization to focus on natural
essence of the products to form strong customer base. Vision of an organization is therefore to
bring innovation in drink products with new natural flavours that will depict the higher quality of
product in the market. Therefore it can be said that innovation is necessary to drive the step
toward in achieving vision.
Leadership: Leadership depicts the quality of an employee to develop trust among the
employees and encourage them to work together toward the goals of bringing creativity in the
existing products to attract more number of customers as compared to competitors. 3V Natural
Foods for bringing innovation in drink products need skilled and qualified leaders that not only
focus on product development but support team members to maintain relationship to work
together (González-Benito et.al.2016). Leaders are responsible for making discussions with team
members so as to enhance the innovative ideas which will bring encouragement among team
members as well as increases the overall productivity.
Culture: Employees are one in an organization who are responsible for bringing innovation with
the help of their skill sets. Therefore, it is important to focus on motivating employees to
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encourage them to work hard to achieve desired goal of an organization. Working together as a
team to bring innovation is essential and for this motivation is one of the most important factor.
Teamwork: 3V Natural Foods develop wide range of food and drink products which are
impossible without utilising the skill sets of employees. It is not possible to bring innovation and
creativity in existing products with the support of individual. End goals of an organization can
only be achieved with the combined skills of more number of employees. Each employee in an
organization is assigned varied roles and responsibilities as per their capability to contribute to
achieve the goal. Therefore, team work is required to solve the issues that act as barrier in
innovation.
As per the above discussed factors and elements, it can be said that innovation can only be
achieved by combined effects of the above explained factors.
6

LO2
P3 Explain the 4Ps of innovation and explain the use of the innovation funnel to examine and
shape innovative ideas.
3V Natural Foods has high focus on enhancing the sales volume of its products and to achieve
this an organization must implement some techniques and strategies (Bali et.al.2016). 4Ps of
innovation referred to as innovation mix can be implemented to improve the innovation process.
The process will help an organization to identify the areas need innovation. 4Ps of innovation are
explained as:
Figure 3: 4Ps of innovation
(Source: Innovation Management, 2018)
Product: It plays an important role in fulfilling the needs of customers. An organization must
ensure that product to be developed is unique in terms of its features so as to gain competitive
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advantage in the market. 3V Natural Foods offer unique food products and beverages and with
the help of innovation in its beverages it supports meeting the customer satisfaction.
Process: The process undertaken by an organization that brings changes in the products and
services to be delivered. For an instance, 3V Natural Foods bring changes in its marketing
processes to make customers aware about its new natural drink products. Their production
processes must be modified to manufacture the natural drinks in spite of artificial flavoured
products.
Position: It is important for 3V Natural Foods to focus on positioning of product in the
competitive market. Marketing Strategy can be made stronger by using social media and this
strategy is undertaken on the basis of target segment to fulfil the needs of customers (Akgun
et.al.2017).
Paradigm: This deals with humanitarian sector such as behaviour and its impact on local
ownership, responsibility, leadership, etc. 3V Natural Foods make customers aware about the
importance of natural drinks over flavoured drinks and why are they expensive as compared to
other products to modify the mindset of customers with respect to its prices.
Utility of Innovation Funnel
Innovation funnel is used to explain the process involved in development of new product. 3V
Natural Foods can utilise innovation funnel to transform ideas into development of innovation in
the product. Stages involved in it are as follows:
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Figure 4: Phases of innovation funnel
(Source: Funnel Innovation, 2018)
Table 1: Innovation Funnel Stages
Stages of Innovation Funnel Description
Idea Generation 3V Natural Foods at this stage collect as many
ideas as possible to innovate its existing products.
An organization can utilise information from
competitors, existing partners, research, etc.
Rough Concept At this stage, all the collected ideas must be
screened to combine ideas with objectives to bring
innovation (Innovation Funnel, 2018).
Detailed Concept 3V Natural Foods must ensure that generated ideas
must be as per the organization’s objectives.
Market Launch After the development of final product, it is
important to launch the product. For an instance
organic drinks are to be launched in the target
market to gain profitability.
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P4 Explain developments in frugal innovation and provide examples of how it is used in an
organisational context
Frugal Innovation is an approach of utilising resources in an organization in an appropriate
manner in terms of financial, employees. Effective utilisation of resources is essential for
transforming innovative ideas to practicality. 3V natural faced issues related to lack of funds, and
therefore different developments in Frugal Innovation are explained as:
Identification of Issues: Maximum of the population in current scenario faced several health
issues and prefers to have natural food and drink products. 3V Natural Foods identified the factor
for its less selling of product is its inorganic food and drink products and therefore, it focused on
bringing innovation its exiting drink products (Zeschky et.al.2014). An organization faced
challenges in terms of less number of resources and funds. Therefore, it is important to focus on
effective utilisation of resources as per the defined budget to meet the demands of customers. For
this training of employees to develop strategies to define the cost effectiveness of operations is
important.
Identification of solutions: Frugal Innovation has high focus on solving cost related issues. 3V
Natural Foods can minimise the over usage of resources like energy by implanting solar panels
to generate power. It can also train the workers and adopt technology to extract natural essence
from the environment rather than to pay high cost to suppliers. Natural Water can be utilised
instead of bottled water for production purposes.
Implementation of Fugal Innovation: Less utilisation of resources will put positive impact on
production facilities. Moreover saved resources can be utilised in future at the time of shortage of
resources. 3V Natural Foods must focus on training of employees so that natural resources like
solar energy, natural flavours from environment can be utilised effectively to save the overall
cost of operations.
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LO3
P5 Explain the importance of the commercial funnel and the application of New Product
Development (NPD) processing for commercialisation of innovation
Commercial Funnel or Sales Funnel
Commercial Funnels can be defined as the buying process followed by customers to buy
products while considering various factors. It includes various stages responsible for achieving
organizational goals that deal with interacting customers through various sources such as e
commerce, advertisements, online purchase, and many more (Mahajan and Moore, 2015). Sales
Funnel implemented by 3V Natural Foods will support an organization to analyse and manage
the sales opportunities in the market.
Figure 5: Sales Funnel
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(Source: Sales funnel, 2018)
Sales Funnel follows the stages as shown in the figure. The most important stage is to adopt
marketing strategies to make customers aware about its new innovative products. 3V innovative
products must focus on using social media marketing to attract more number of customers. The
next stage is referred to as Prospect in which marketing team of 3V Natural foods have
communicated the benefits of new innovative product and customers are highly interested in its
natural flavours. To assure that interested customers make decision making in favour of buying,
they must provide free samples to customers to gain their trust (Sales funnel, 2018). The entire
process of gaining the trust of customers will enhance its sales in positive manner.
New product development process
New product development process is based on launching a product in the market that includes
conception to market. 3V Organic Foods can utilise the approach for improving the essence of
drink products towards natural flavours. Various stages involved in the process are:
Table 2: New Product Development Process
Stages in NPD Description
Idea Generation New Idea of natural flavoured drinks
Idea Evaluation There is no sales observed in non organic drinks
therefore production of such drinks must be
limited.
Strategic Analysis Marketing strategies must be developed to attract
more customers to gain more profitability (Product
development process, 2018)
Product Testing Sample drink must be developed and distributed
free to target customers so test its taste and flavours
Market Testing Feedback of customers must be used to modify the
existing products.
Commercialisation The pricing of the natural drink at the initial stage
must be such that it is very affordable (Tinoco and
Ambrose, 2017).
Product Launch The last stage is to launch the product in the market
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with the combination of marketing strategies.
The above process will support 3V Organic Foods to identify that innovation is fruitful in the
market or not. Implementation of the process will support an organization to expand its business
segment by identifying the lacking areas.
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P6 Build an Innovation Business Case for an organization, including ways to access funding.
3V Organic Foods to build an innovation business case must follow appropriate steps for
planning as well as implementation in order to achieve the future growth. Various stages are
explained as:
Analysis of issues: 3V Organic Foods must focus on expanding product range to enhance the
level of business opportunities in terms of sales and revenue generation. An issue faced by an
organization is large number of competitors as well as product substitutes available at reduced
prices.
Setting of objectives: The main objective of 3V Organic Foods is to provide quality of food
products that can be achieved by training of employees (Charles et.al.2017). Innovation and
creativity in the existing product and services is the another objective which can be achieved by
using digital solutions to increase the sales and productivity.
Innovation: 3V Organic Foods is planning to bring natural drink products in addition to organic
food products that have high focus on fulfilling the health needs of customers in the society. It
must focus on providing online selling of products to increase the overall sales. This will
facilitate customers to save their time. Adoption of technology in marketing processes and
innovation in existing product will develop the trust of customers and will encourage them to
repeat their purchase. It is also planning to offer 24x7 services to its customers through its online
portals.
Cost benefits: As compared to drinks of artificial flavours, it is identified that natural drinks are
expensive because of their health effective essence. Still 3V Organic Foods must focus on
maintaining the affordable prices so as to increase the sales of the product. Increased selling will
support generating revenue and profitability. The main objective of business organization is to
increase its productivity and profit margins at the same time which can be achieved by
developing the customer loyalty.
Expenses Cost(in Dollars)
Production 400
Raw material 300
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Labour 400
Management and marketing 400
Total 1500
Total Expenses in adding natural flavours to the existing drink is $1500. The calculated revenue
of an organization is $2500. Therefore net profit from this innovation $2500-$1500=$1000.
Access to Funds: For bringing innovation in current product, 3V Organic Products must access
funds through investors, banks and small financial institutions by communicating about their
ideas. They can also rely on retail business partners who sell their products to customers. Funds
are raised for future benefits of its growth and development which are returned back to the
investors along with some interest in the specific duration of time.
Feedback related to products: Products must be launched in the market with the help of
marketing strategies to reach the maximum of customers (Schaltegger and Wagner, 2017).
Launch of the product must be followed by distribution of free samples of the products so as to
gain the feedbacks and reviews of customers. Reviews of customers will support 3V Organic
Foods to modify the products as per the expectation of customers.
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LO4
P7 Evaluate the different tools that organisations can use to develop, retain and protect
knowledge and intellectual property.
Intellectual Property Management tool is utilised by an organization to increase its net worth. 3V
Organic Foods utilises the tool to gain competitive advantage in the market by enhancing its
productivity. The major advantage of the tool is to retain and protect the knowledge, which can
be implemented by using various tools such as:
Figure 6: Intellectual Property Tools
(Source: Intellectual Property Tools, 2018)
Patents: In order to offer new products and services, various rights are granted to investors by the
government in the market. The tool prohibits inventing the similar product so as to maintain the
uniqueness of the product. It is only right of patent owner to sell the ownership of the product to
other business entities to manufacture and bring innovation in existing product. This will help 3V
Organic Foods to gain competitive advantage in the market.
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Trademarks: Trademark is represented as symbol that depicts the image of the product. It
includes sign, logo, symbol, etc used by business entities to show that product is being
manufactured under the brand name of their organization (Drahos, 2016). For an instance, 3V
Organic Food will prohibit other drink manufacturers to use the same brand name which will
have legal implications.
Copyright: It is important for business organizations to protect their process of production or
manufacturing with the support of software or models that can be referred to as copyright. This
type of protection will enable an organization to protect the rights of innovation as well as
business ownership. This protects the ownership of products for the longer duration of time and
is very highly effective.
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Conclusion
From the above study, it has been identified that innovation plays an important role in growth
and development of business entity. It is highly supportive in increasing productivity and
profitability of business organization. Innovation contributes to the economic growth along with
expansion of business in terms on sales and revenue generation. Report has developed the ways
to bring innovation in an effective manner so as to cover the losses and risks involved in bringing
changes in the existing products. 3V Organic Goods will bring innovation in its drink products to
provide health benefits to its customers to enhance the business operations. Report has explained
the planning stages that are necessary to be implemented in the business to utilise the resources
in an effective manner. Innovation business case in the report has helped to calculate the overall
profitability gained with the help of innovation.
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References
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sustainable development. Routledge.
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14/018,665.
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Mazzei, M.J., Flynn, C.B. and Haynie, J.J., 2016. Moving beyond initial success: Promoting
innovation in small businesses through high-performance work practices. Business
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